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Achieving Basel II Security Compliance with Aladdin Solutions

The Basel II Accord, which went into affect in member countries by year-end 2006, is based on three pillars, designed to ensure that banks effectively monitor risk and implement sufficient risk-management practices to protect the institution.

The three pillars are:

Minimum Capital Requirements: describes the calculation for regulatory capital, credit, operational and market risks
Supervision: creates a framework of supervisory oversight and review processes to encourage better risk practices and to reduce other risks
Market Discipline: requires banks to disclose capital structure, risk exposures and capital adequacy in detail

The focus of each of the three pillars is the reduction of operational risk. The committee defines operational risk as "loss resulting from inadequate or failed internal processes, people and systems or from external events." Member banks are subject to a capital charge to cover unexpected losses, but the amount of the capital charge can be reduced if the bank can demonstrate to regulators that they have sound operational risk management procedures implemented.

Strong Security as a Solution

One of the primary elements of managing risk is to have an effective network defense system. Aladdin's enterprise security solutions, eSafe and eToken, protect your network resources and reduce operational risk by:

Protecting against phishing attacks, viruses, worms, spyware, and other threats posed by an explosive rise in malware designed to steal personal and corporate data.
Preventing unauthorized access to data by ensuring that individuals who access the network and applications are indeed who they claim to be, allowing you to tighten user access controls and enhance the security of your sensitive data.

: Following are key elements of the eSafe and eToken solutions for reducing operational risk under Basel II:

Aladdin eSafe and Basel II

Aladdin's eSafe helps meet Basel II risk management guidelines by providing organizations with a comprehensive network security architecture capable of blocking unauthorized access to network resources, blocking malware and network attacks, and safeguarding sensitive information.

Secure email from various forms of malicious content such as malware file attachments, vulnerability exploits, malicious macros, and other types of email-borne attacks.
Secure mobile communications enabling complete protection against known threats and effective defense against new, or zero day, threats.
Secure Web traffic by providing URL-filtering and malicious code protection for users visiting Web sites, as well as providing the ability to scan data within encrypted communications channels.
Secure against application-level threats with the capability to protect against attacks and malicious code originating from instant messaging (IM), peer-to-peer (P2P) networking, or other application-level threats.

Aladdin eToken and Basel II

eToken strong authentication helps banks meet Basel II standards by ensuring strong authentication security. The eToken offering is based upon a comprehensive smart-card-based strong authentication solution, which can be implemented for all of the bank's users.

Secure access to the bank's network preventing unauthorized access to classified data, such as customer account information.
Secure transactions, e-mail and documents with secure on-board generation and mobile storage of PKI keys and digital certificates, reducing operational risk by enabling encryption of sensitive data over the net, digital signatures, proof of authenticity (ensuring data has not been changed after it has been digitally signed), and non-repudiation of transactions.
Secure password management enabling portable, secure storage of user credentials, reducing operational risk by eliminating the inherent weaknesses of traditional password-based authentication.
Secure physical access by incorporating RFID technology to provide combined logical and physical access solutions in one device, lowering operational risk by preventing unauthorized physical access.
Token management system enabling full enterprise-level automated deployment and life-cycle management of tokens, diminishing operational risk by reducing human intervention in token management activities.

For more information on how Aladdin can help your organization meet SOX requirements:
Contact an Aladdin representative.; Want to learn more?
Background on Basel II.